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Informist, Friday, Feb. 21, 2025

By Akshita Kumar

MUMBAI – The benchmark indices fell for the second straight week with the Nifty 50 Friday closing below 22800 points for the first time in over eight months. Automobile companies fell on the risk of competition from global electric vehicle maker Tesla, while uncertainty about US President Donald Trump's tariff plans affected market sentiment, analysts said.

The Nifty 50 closed at 22795.90 points, down 117.25 points or 0.5%. The BSE Sensex closed at 75311.06 points, down 424.90 points or 0.6%. In two weeks, the Nifty 50 has lost over 3%. The index is down 13% from the lifetime high it touched in September. The broader market took a bigger hit Friday after gaining in the past two sessions. Mid-cap indices fell 1.1-1.3% and small-cap indices fell 0.6-1.1%.

Expensive valuations, global uncertainties, and lower-than-expected December quarter financial results are some of the factors hurting sentiment in the domestic market, Vinit Bolinjkar, head of research at Ventura Securities, said. "With Nifty 50 companies giving single-digit earnings coupled with rising inflation, why will anyone put money in the equity market now?" he remarked. According to an analysis by Informist, the net profit of Nifty 50 companies after excluding exceptional items has risen by only 3.9%.

Among stocks, shares of Mahindra & Mahindra fell 6.5% intraday to hit its lowest level in over five months at INR 2,653.35. At close, the stock ended down 6%. The sharp sell-off in the stock is a result of fears among investors that the entry of Tesla in the domestic market may pose a stiff competition to automakers such as Mahindra & Mahindra, which recently launched new electric models in the premium category, a research analyst tracking the automobile sector at a domestic brokerage said. Among others, shares of Tata Motors ended 2.4% lower. Owing to the sell-off, the Nifty Auto index plunged nearly 3% and closed at its lowest level in over 10 months at 21505.90 points. 

While automobile stocks were largely down, bank stocks were mixed. Shares of State Bank of India, Axis Bank, and IndusInd Bank failed to sustain the gains accumulated in the morning and closed lower, contributing to the fall in the benchmark indices. At the same time, shares of index-heavyweight HDFC Bank ended 0.3% higher after falling 0.6% in the first hour of trade.

Among others, shares of Bharat Petroleum Corp. ended 2.8% lower, losing all of the gains accumulated in the previous four sessions. Most Adani Group companies also ended in the red. Adani Enterprises and Adani Ports and Special Economic Zone both ended over 2% lower.

Metal companies were among the few stocks that made significant gains on hopes of better earnings in the upcoming quarters. Among these, Shares of Hindalco Industries ended up 2.3%, extending its gains for the eighth straight session. Shares of Tata Steel also ended up 2%.

The December quarter financial results of companies in the metals sector were strong and resilient despite challenges, an analyst tracking the sector said. An analysis by Informist found that the cumulative net profit, excluding exceptional items, of eight metal and mining companies in the Nifty 200 index rose 5% on year. Analysts had expected the net profit to fall nearly 7%.

Owing to gains in metal companies, the Nifty Metal index ended at its highest level in a month at 8609.7 points, up 1%. The sectoral index touched its resistance of 8600 points Friday, Osho Krishan, senior research analyst at Angel One, said.

Shares of JSW infrastructure ended nearly 9% higher. Brokerage Motilal Oswal Financial Services retained its 'buy' rating on the stock with a target price of INR 330, according to an ET Now report. The company is looking for organic and inorganic expansion and has also entered into an agreement for operations and maintenance of bulk cargo handling works at Fujairah port in the United Arab Emirates, the brokerage said.

* Of the Nifty 50 stocks, 15 rose and 35 fell

* Of the Sensex stocks, 9 rose and 21 fell

* On the NSE, 1,100 stocks rose, 1,744 fell, and 72 were unchanged

* On the BSE, 1,701 stocks rose, 2,246 fell, and 113 were unchanged

* Nifty Auto: down 2.6%; Nifty Healthcare: down 1.9%; Nifty Metal: up 1%

BSE                                               NSE

Sensex: 75311.06, down 424.90 points or 0.6%      Nifty 50: 22795.90, down 117.25 points or 0.5%

End

Edited by Rajeev Pai

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